You are debating receiving your real estate loans from either a bank or a private lender. There’s been a lot of talks lately about private lenders like us here at Gelt Financial, so why choose this non-traditional financing route for your investor real estate loans over one from a bank? As you mull over your options, think about the numerous advantages a private lender can offer, and perhaps realize that banks, although ubiquitous, don’t meet the demands of real estate you once thought they did.
With Investor Real Estate Loans Qualifying is Simple
Qualifying really is simple with a private lender. Banks demand credit scores, various credit reports, your payment history, and want to analyze your income all to see if you’ll be paying back your loan in a trustworthy, timely manner. A private lender is nearly the opposite approach.
With private lenders, qualifying is half of this process and much less severe and anxiety-ridden. Private lenders don’t worry as much about you, the borrower, and only really ask that you maybe provide a few months of bank statements and information on your property purchasing details. As a private lender, on many of our loans, we do not ask for a minimum credit score or ask for a credit score of 550 or above as we use the property as collateral for the loan.
Collateral Only Real Estate Loans
Why is qualifying so easy? Because private lenders look for collateral in your physical property, not in your trustworthiness as someone paying back the loan. Private lenders know they can obtain this collateral if necessary, and if you default on the loan, the lender will turn around and sell the property to make up for it. If you pay the loan back and everything goes swimmingly, you as the borrower and your private lender have nothing to worry about and everything works out to everyone’s favor.
No Credit Necessary
Private money lenders are an excellent option for people struggling to find investor real estate loans in the traditional way. If banks turn them away, a private lender will accept them—no credit necessary. For some people with a rocky credit history who maybe fell on some harsh financial times, this is a saving grace and second chance. Without having to provide credit, borrowers going to private lenders can start anew, pursuing their real estate dreams without being refused by banks over and over again.
Deal Directly with The Decision Makers
Private lenders allow borrowers to skip over any third-party nonsense that banks and standard financers utilize during the loan approval and execution process. With us as your private lender, borrowers work directly with our representatives, the decision makers, those with experience and who are heading their loan. Unlike a bank, borrowers communicate with the lenders who are essential to their specific loan and account. There are no committees, just direct communication.
Custom Tailored Solutions
Expansive banks, especially national banks, do not have the time or resources to devote to each individual borrower, and this leaves loans generalized and unwilling in their flexibility to meet goals or financial situations. Private lenders, alternatively, have the opportunity to tailor loans, terms, and rates to their borrower’s financial needs, allowing a completely customized financing experience. Private lenders are not made to follow the strict guidelines that banks must adhere to with the loan process, and because of this, borrowers benefit the most.
Fast service, individualized loans, dedicated private lenders, and a completely different approval approach and qualifications—these are just a few advantages that private money lenders have over a big name bank. Investor real estate demands quick financing, and with that raises the growing importance of these private lenders. Potential real estate properties can come and go in a matter of seconds, and with a private lender financing your investments, you can be the one doing the closing.